* Markets wait for Fed, ECB meetings, trade deadline
* Swedish crown surges on inflation surprise
* HK dlr hits highest since July as carry trades unwound
* Sterling stung by latest UK election poll
* Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh
(Adds new quote, details, latest prices)
By Tommy Reggiori Wilkes
LONDON, Dec 11 (Reuters) - Sweden's crown jumped to 8-month
highs on Wednesday after strong inflation made it highly likely
the country would end negative interest rates, while broader FX
markets were quiet before central bank meetings and a U.S.-China
trade deadline.
The crown was the standout performer, hitting its strongest
since April against the euro and since July versus the dollar
after the pace of inflation in November picked up by more than
expected. "This obviously supports the Riksbank case of the well
anticipated rate hike despite virtually all other data working
against the Riksbank's own economic outlook," said Olle
Holmgren, an economist at SEB.
The euro was last down 0.8% against the crown at 10.454
EURSEK=D3 , leaving the Swedish currency at its strongest since
late April.
The dollar dropped 0.6% to 9.432 crowns per euro SEK=D3 ,
its weakest since July.
In another notable move, the Hong Kong dollar rallied to its
strongest level since July 24, which analysts attributed to the
unwinding of bets previously profiting from "carry trades" -
borrowing with low interest rates in Hong Kong to purchase U.S.
dollar assets.
The Hong Kong dollar was 0.2% higher at 7.8105 HKD=D3 .
The U.S. dollar clawed higher as investors awaited the
outcome of the Federal Reserve meeting and drew some support
from hopes that U.S. President Donald Trump will delay the
imposition of more tariffs on Chinese goods.
The British pound recovered most of its losses touched off
by a poll showing the ruling Conservative Party's lead narrowing
in Thursday's general election.
FX markets more broadly struggled for direction with
investors awaiting the Fed, UK election, a European Central Bank
meeting on Thursday and the Dec. 15 trade deadline.
The dollar rose 0.1% against a basket of currencies .DXY
and 0.1% versus the euro to $1.1081 EUR=EBS , helped by a Wall
Street Journal report of officials from both the United States
and China saying the groundwork was being laid to push back the
tariff deadline. "The trade negotiations will be key. You could argue there
is a degree of complacency here," said Neil Mellor, an FX
analyst at BNY Mellon.
Mellor said he thought the Federal Reserve meeting would be
a "damp squib", while Christine Lagarde's first policy meeting
at ECB chief was unlikely to produce any fireworks.
Economic uncertainty stemming from the U.S.-China trade war
has prompted the U.S. Federal Reserve to cut interest rates
three times this year. It is almost unanimously expected to
leave interest rates unchanged on Wednesday. Sterling's recent rally came to a halt after the latest
polling data. The pound fell to as low as $1.3107 GBP=D3 but
was last at $1.3154, flat on the day. The dollar was down marginally against the Japanese yen at
108.67 JPY=EBS
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Euro vs Swedish crown https://tmsnrt.rs/2PdkA0S
U.S. dollar vs Hong Kong dollar https://tmsnrt.rs/38uoolK
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